Sunday, October 29, 2017

On October 24, 2017, NEHI released a 33 page white paper on new approaches to value-based oncology drug pricing. And on October 26, NEHI held a webinar on the topic, featuring speakers from Novartis and Harvard Pilgrim and focusing on outcomes-based billing and pricing for KYMRIAH (list price $475,000).

See also: value based white paper from Duke with Health Affairs essay; links at bottom.

CMS Still In Background
The presentation doesn't feature any speakers from CMS/CMMI, who told NEHI they weren't ready to publicly discuss the in-progress indication-based and outcome-based pricing model. I had earlier noted that while CMS and Novartis released "joint press releases" in early September about KYMRIAH, many journalists missed the fact that the CMS statement said next to nothing except for some vague, general positioning about hoping to support biopharma innovation (here, here). It was noted there is nothing yet about the project on the CMMI website.

Indication Based J Codes?
According to Novartis in the new webinar, CMS will create different J codes for different indication and seems to have agreed with Novartis about only billing for successful patients. As I pointed out in September, details have to be hammered out since hospitals, not biopharmas, generally bill CMS for drugs, and CMS most commonly sets Medicare policy centrally while leaving many aspects of Medicaid policy to the states. The question of hospital markups (e.g. billing $950,000 for $475,000 of Kymriah) similarly arose a couple times in the webinar.

Links

The webpage for the white paper and presentation is here. You'll find one link for the PDF and one link that takes you to the video on Vimeo. For more details on the sixty minute presentation, here.

In addition to this October 24 white paper on oncology drugs, NEHI has a home page for all its white papers on price innovation initiatives, here.

See also: Duke & Health Affairs, October 30, 2017.

For an essay from the Margolis Center at Duke, by Daniel, Leschly, Marrazzo, and McClellan titled "Advancing Gene Therapies and Curative Health through Value Based Payment Reform." Here. Includes links to the Duke-based "Value Based Payment Consortium," here.

Like NEHI, this center also has an October 2017 white paper on the path to Value Based Payment for medical products (23pp), here.

The National Pharmaceutical Council's 2016 white paper on this topic (15pp) is here.

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While the original approval of Kymriah was very an extremely rare pediatric condition, Novartis has filed for FDA approval for diffuse large B cell lymphoma in adults, a much more common condtion (here).

About the Author

Bruce Quinn MD PhD is an expert on health reform, innovation, and Medicare policy. He helps both large and small companies understand and overcome hurdles to commercialization, as well as craft business strategies for a changing environment. CONTACT Dr. Quinn through www.brucequinn.com. BACKGROUND: Dr. Quinn has worked in academic medicine, Accenture business strategies, and for the Medicare program. EDUCATION: Stanford MD/PhD, MIT Postdoc, Kellogg MBA.